Electricity is free, but we pay energy companies to harness it.

Water is free, but we pay for the privilege of filtering.

Air is free, but we pay for the solution of conditioning it for summers in our homes.

Natural gas is free, but we pay for the importance of safety in its use.

Oil is free, but we pay for the welling and distribution.

When we get down to it, all the things we could have for free we’re willing to pay for, because where needs are met, value is gained.

If you meet the needs of your audience, why would the value you bring be free?

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Danny Brown
Co-author Influence Marketing: How to Create, Manage and Measure Brand Influencers in Social Media Marketing. #1 marketing blog in world as per HubSpot. Husband. Father. Optimist. Pragmatist. Never says no to a good single malt. You can find me on Twitter - Google+ - LinkedIn.
44 comments
Brigitte_Grisanti
Brigitte_Grisanti

So very true about your article.I have always want to live off the grid but it is so very expensive to hook up solar power.

 

Really, if everything was free nobody would work. LOL

 

Thanks Brigitte Grisanti

Leon
Leon

G'Day Danny,

I'm having a frantic 'Catch up wth emails day." The upside is that I'm being accompanied by Frank Sinatra.

Now; value.

 

Y'know, the older I get the more I'm becoming interested in the whole issue of value per se. I've written a couple of pieces about value and employees in the last year. I have a couple more in the course of preparation.

 

I suspect we have too narrow a view of value. Ricardo Semler talks about  ensuring that employees are 'proud of their work." That's an aspect of value we rarely consider. I'm also looking at what used to be called corporate culture. For instance, as a manager what values do you want your businesss to represent?

 

The really interesting thing about value is that it's always in the eye of the beholder. It's probably got little to do with money. Everyone talks about "value for money." It is important. But I suspect that the people we hang out with, marry, do business with maty well be people whose values we're comfortable with.......or at least who are comfortable with what they perceive to be ours

 

We've been a Mac house for years. But the reason we changed to mac about  25 years ago was that the mac treated us as adults. The other PCs at the time demanded lots of technical knowhow from the user. Mac said "press here and we'll fit in with you"

 

Having nearly 35 years consulting experience, I believe that "the people who need you least , use you most." Maybe that reflects the whole value issue too. I'm not sure. I'm just an Aussie curmudgeon.

 

 

Best Wishes

Leon

 

SteveF
SteveF

Danny, Not exacty. None of those things are really free, except water and air. Electricity doesn't exist until it is generated. Sure, the electrons freely exist, but that's about it. Electricity, as we know it, must be generatedfrom nothing by the electric utilities, then transported to the point of use. 

 

All those otherthngs have a cost. Even if they exist, they are not free, becuse costs are incurred in making them usable. With the exception of water, even if the utility companies didn't exist, we would incurr costs in locating, extracting and transforming the reources, even if tha was only our time.

KRLRose
KRLRose

I agree. Nothing is truly free. At some point we have to pay whether it is through the choices we make, the values we hold dear, or the principles we forget to uphold. Life and business is a contract with the world. The currency exchanged is the level of epic creativity, wisdom and knowledge we provide. And for that I am prepared to pay accordingly all day every day. 

 

Damn that gun looks serious. :) 

 

Peace. Respect.

Steven Hourston
Steven Hourston

Value is always in the eye of the beholder. 

 

We all have ingrained, strongly held views about value. Unfortunately we often apply those views to our own business. Many people tend to think that no one would ever pay more than the lowest possible price for their goods and services. So they charge low prices and doom themselves to the depressing world of price wars, hard selling tactics, endless offers and hype. 

 

We must resist imposing our pricing prejudices on our customers.

 

Last week I checked out the cost of return flights from London to New York. I could spend £247 for economy on BA, or I could blow £4559 for a different experience on the same plane. And there are other options in between. I could even spend 26x more than BA's cheapest option and indulge myself with a £6312 Upper Class Flexible experience on Virgin. 

 

All Virgin and BA have done is to discover what their customers value and then give them a range of options at prices they’re willing to pay. And they make much more money because of the choices they offer and their skilful pricing.

Latest blog post: Do You Earn What You're Worth?

Marlena
Marlena

Inspiring points, the value mustn't be free, I think, it would degrade the quality of the given thoughts/ideas/products/knowledge. Thanks for sharing your thoughts, I totally agree.

sanjay41
sanjay41

This is one of the reason why we need ebooks and webinars, because they are curated for our convenience.

sadiq
sadiq

everything have value..=)

Anders Michael
Anders Michael

Cool post, Danny! Thanks for sharing and putting things into perspective :)

wmwebdes
wmwebdes

I'll think of this post when I get my next email, which begins...

 

"We are a small startup company with a limited budget and we would like a fabulous website that ranks #1 in Google for the following key phrases...."

 

 

Andrea T.H.W.
Andrea T.H.W.

Actually you pay for most of these things because you're forced to and for others to make money. Example you could have a wind generator for really free electricity for less than 1000 bucks yet it's very difficult a government let you to get it because in this way no exchange of money and no taxes.

 

I mean here in Italy we don't pay petrol 2 euros per litre for welling and distribution but for taxes and oil companies' earnings.

 

Having said that I see your point and it's definitely valid. A free service like an informational blog is priceless and of high value but having to pay for it can be a problem because if I read ten blogs I could go broken. Probably not everything should be given or searched for free and not everything should be paid for. The basics could and an upper sevice could be paid. But again not so easy. Think if we had to pay for every plugin or theme. In a snap 90 percent of blogs would disappear and nothing guarantees that the ones which remain would be the best ones. But surely those which can afford the expenses.

 

Great post, short but really intriguing. :)

Latest blog post: What is Motivation?

thefutureisred
thefutureisred

I agree with you 100%. When it comes to putting this into practice, though, things become a bit more murky.

 

For example, I run an art and education organization in Argentina. People can stay at the arthouse we've established. They pay to stay, but I connect people with volunteer organizations for free. Perhaps later, when I'm more established, I can charge for this. I'm also not sure my particular audience, mostly shoestring travelers, would pay just for a connection like that, even though it is of huge value.

 

I'm also trying to balance actual payment in money with other types of payment. That is, money isn't the only currency. I've found trade to be sticky, but when a volunteer has a good experience, it builds the reputation of the overall organization.

 

As you can see, I'm still figuring things out. I've been a teacher, artist, photographer and writer for years. But this running my own business thing requires seeing things a bit differently.

thefutureisred
thefutureisred

I agree with you 100%. When it comes to putting this into practice, though, things become a bit more murky.   For example, I run an art and education organization in Argentina. People can stay at the arthouse we've established. They pay to stay, but I connect people with volunteer organizations for free. Perhaps later, when I'm more established, I can charge for this. I'm also not sure my particular audience, mostly shoestring travelers, would pay just for a connection like that, even though it is of huge value.   I'm also trying to balance actual payment in money with other types of payment. That is, money isn't the only currency. I've found trade to be sticky, but when a volunteer has a good experience, it builds the reputation of the overall organization.   As you can see, I'm still figuring things out. I've been a teacher, artist, photographer and writer for years. But this running my own business thing requires seeing things a bit differently.

AmyMccTobin
AmyMccTobin

This is the constant headache for the self-employed consultant; no one expects a contractor to work for free.  I've begun taking the ballsy approach and just telling them at the initial meeting that I get paid for my advice, including the 18 phone calls a month I field to guide my clients.  The ones that balk at that are the ones I don't want anyway.

Steven Hourston
Steven Hourston

Why would your value be free?    What a good, challenging question. Value is always in the eye of the beholder.   We all have ingrained, strongly held views about value. Unfortunately we often apply those views to our own business. Many people tend to think that no one would ever pay more than the lowest possible price for their goods and services. So they charge low prices and doom themselves to the depressing world of price wars, hard selling tactics, endless offers and hype.   Last week I checked out the cost of return flights from London to New York. At one extreme, I could spend £247 for economy on BA or at the other, £6312 for an Upper Class Flexible ticket on Virgin. That's 26x more!   All Virgin and BA have done is to discover what their customer’s value and then give them a range of  options at prices they’re willing to pay. And they make much more money because of the choices they offer and their skilful pricing.  

Rhysorwin
Rhysorwin

I really like that, I do way too much for free!

mim.gomberg
mim.gomberg

Danny, I have spent much of my life feeling as if I should be apologetic for charging for my time. Now I am of the opinion that I won't work for free because my time is valuable (if only to me).

 

Thanks for the reminder. It made a great poem. Miriam

rdopping
rdopping

Now that's the holy grail, isn't it?

 

The ones that actually makes sense to me in this context are the air & water. Why? Because oil, natural gas and energy are not things ANYONE can get on their own whenever they want without going through some other process to get it. Air and water (and not necessarily water in certain parts of the world) are truly free just like the content I provide.

 

Until I figure out how to condition or filter my content I won't get a cent for it. In other words, until someone sees the actual value of my conditioned content it's going to be like air. Hot air likely......;-) 

brittanybotti
brittanybotti

Great reminder Danny...needed that. Thank you!

TheJackB
TheJackB

Hi Danny,

 

It reminds me of many conversations I have had. Do you want to be the low price leader or do you want people to purchase your product because it is valuable. I'll go out on a limb and say that I am certain you'll agree with me that value is more important than price.

 

Prove that your service/product is worth something and people will gladly pay for it.

Latest blog post: Eight Years Later

pawelgra77
pawelgra77

Hi Danny, I think there's a second level to this, it's convenience. You pay for water because you simply don't want to dig up a well in your backyard. Same with gas, oil (providing that you would have access to them yourself of course) or electricity. It's convenience (or a lack of any other choice) that often makes us to pay for something. 

 

That's not to say that convenience is not the actual value.

Danny Brown
Danny Brown moderator

 @Brigitte_Grisanti One of my friends went the solar route. They said the same thing, the set-up is crazy. After that, though, the savings are huge. May have to look into it myself!

Danny Brown
Danny Brown moderator

 @Leon The pride thing is huge, mate, isn't it? If we can all go home and say we were proud of what we did that day, imagine the domino effect that's going to have on the people that come into effect with what we worked on.

 

Here's to the passionate creators.

Danny Brown
Danny Brown moderator

 @SteveF Agree and disagree, Steve.

 

Electricity exists prior to utility intervention (I don't see any hydro companies creating electrical storms). So, it's still free.

 

Completely agree on the costs of locating, etc - but then that also boils back to the "needs" argument, since we need all those parts to make even the simplest thing happen.

 

Yes, our time is valuable - but unless we're charging for that time in any capacity, then essentially we're giving it away for free. Even when we don't need to.

Latest blog post: State of Independence

Danny Brown
Danny Brown moderator

 @Steven Hourston That's such a true point about our self-worth, mate. I can't recall who said it, but I remember a passage from a business book that advised, "Charge what you feel your worth - and then add 50%."

 

The thinking was, we so undervalue what we do that we could double our prices at least and we'd still be offering huge value.

 

Interesting thoughts, indeed. Cheers, mate!

Danny Brown
Danny Brown moderator

 @thefutureisred Hmm, that's an interesting question and position. Can you work with the places you send travellers to for a referral fee? Or do you already have this in place? Perhaps you can partner with the tourism board to be the official Art Guide, because you can be trusted for your expertise over someone looking to make a fast buck from an uneducated traveller?

 

Great questions and food for thought!

DannyBrown
DannyBrown

 @thefutureisred Hmm, that's an interesting question and position. Can you work with the places you send travellers to for a referral fee? Or do you already have this in place? Perhaps you can partner with the tourism board to be the official Art Guide, because you can be trusted for your expertise over someone looking to make a fast buck from an uneducated traveller?   Great questions and food for thought!

Danny Brown
Danny Brown moderator

 @rdopping That's very true, sir - and, like you say, while water would be great to be free for everyone, sadly not every country has the benefit of healthy water straight from the source. though perhaps that's where the developed countries could pay a little more, so the less fortunate could have safe water free of charge?

 

I'm going off topic here...

Andrea T.H.W.
Andrea T.H.W.

 @DannyBrown Which is linked to "Do what they write really have no free alternative of the same quality somewhere on the net?" Or why should I pay for Office when there is, luckily, Open Office? I think what works is not really just taking the old posts of a blog and putting them into an ebook as they are because I can already find them free, what works is taking them and modifying them so that they are a kind of a different take and then charge for it. Or having a free chapter on a blog and charging for the whole book. I mean, the net is full of unsold books and taste before you buy has always worked weel but I wouldn't pay for something I can have for free.

 

But also free can bring money, like Linux with its distributions. Also there is the fair price thing. As I said on my article on Coaches one thing is paying for experience, knowledge and the reduced time needed to find an answer, another thing is paying for the Coach Ego and enflated rates on a self ruled profession.

 

Also because these days almost everyone is a Coach for something, or a Course provider and so on. ;)

 

Imho what has made blogs to win is that they can be run almost for free and they provide sound knowledge for free. There are other ways to earn money than charging for content unless you write sponsored posts. But who knows, for someone can work.

Latest blog post: What is Motivation?

thefutureisred
thefutureisred

 @DannyBrown Those are the kinds of things we're trying to figure out. It is a bit complicated in that we're not legally allowed to make money in Argentina yet. Not to mention, the places we send volunteers are non profit groups that don't have money.

 

But... it's that way of looking at things I'm trying to get my head around. I'm very good at providing services and connecting people. This business came out of the fact I'd been hosting travelers and connecting them with communities here for years, and then asked myself, "Damn, why am I doing this all for free?"

 

Our business model has us making money from individual travelers staying with us. Then we're also working on putting together tour groups from the US and Europe. I will look into working  directly with the tourist board, though. I'm still in the process of putting our website together (we've only been an official business about 3 months), but I will also add a volunteer tourism type package in addition to just a place to stay.

 

Thanks for helping me work through this. I really appreciate it. I'm also so impressed at how you address all of your comments so thoughtfully. It's a model I plan to use as we develop our website and community.

thefutureisred
thefutureisred

 @DannyBrown Those are the kinds of things we're trying to figure out. It is a bit complicated in that we're not legally allowed to make money in Argentina yet. Not to mention, the places we send volunteers are non profit groups that don't have money.   But... it's that way of looking at things I'm trying to get my head around. I'm very good at providing services and connecting people. This business came out of the fact I'd been hosting travelers and connecting them with communities here for years, and then asked myself, "Damn, why am I doing this all for free?"   Our business model has us making money from individual travelers staying with us. Then we're also working on putting together tour groups from the US and Europe. I will look into working  directly with the tourist board, though. I'm still in the process of putting our website together (we've only been an official business about 3 months), but I will also add a volunteer tourism type package in addition to just a place to stay.   Thanks for helping me work through this. I really appreciate it. I'm also so impressed at how you address all of your comments so thoughtfully. It's a model I plan to use as we develop our website and community.

rdopping
rdopping

Yea but I get it and you make a good point. Cheers. More water = more beer.

pawelgra77
pawelgra77

 @DannyBrown You know what, I am often thinking about this too. We're becoming too spoiled and as you say, forget what value actually means. Certainly, it's not getting low quality things in the fastest time possible (as it is a case with many products today).

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